The dollar’s daily cycle peaked on day 8 and formed a swing high on day 10. But the dollar managed to close above the upper cycle band on day 11 maintaining a bullish posture.
Then the dollar broke lower on day 12. The dollar delivered a trend line break, broke below the upper cycle band and closed below the 50 day MA on day 12 to confirm a daily cycle decline. With a peak on day 8, this daily cycle seemed poised to form as a left translated cycle. However the dollar formed a swing low on Friday, off the day 14 candle. A close above the declining trend line would confirm a new daily cycle.
The daily equity cycle peaked on day 10 and has since trended lower. Stocks did have a false break out above the declining trend line on Wednesday. But stocks ended up closing below the declining trend line on Wednesday. Stocks were clearly rejected by the declining trend line on Thursday, closing below the 50 day MA. Stocks printed a lower low on Friday.
Friday was day 21 for the daily equity cycle. Stocks are about 2 weeks shy of entering its timing band to for a daily cycle low. The peak on day 10 suggests that this daily cycle will form as a left translated cycle. Left translated cycles typically fail, leading to an intermediate cycle decline. Which seems to be unfolding on the weekly chart, which is discussed in the Weekend Report.
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